Innovation 101: How founders of local MY brands are adding revenue stream

Desperate times call for desperate measures. With the current lockdown phenomenon globally, brands are forced to either innovate their business models to remain relevant and stay afloat, or risk perish.  According to a recent study by Goldman Sachs in the US of more than 1,500 small business owners, over half of them said they didn’t have the confidence of operating their business if the current situation lasts more than three months. The study added that the impact of COVID-19 on small businesses and communities all over the world is significant.

gs data

 

While no doubt many of the bigger eCommerce players such as Grab, Shopee, Lazada and AirAsia, have been trying to bring on board smaller merchants on to their platforms during this period to help digitisation efforts, smaller businesses also need to do their part to innovate.  In Malaysia,  Tealive and myBurgerLab, are examples of local businesses in Malaysia that have innovated by producing DIY bubble tea kit and DIY home kit respectively. Meanwhile, Mykori Dessert Cafe also launched its own DIY ice cream kit while Inside Scoop activated its die-hard fans in Klang Valley to collate bulk orders.

Here are some of their stories and tips to innovation: 

Edmund Tan and Lim Shiew Li, founders, Inside Scoop

inside scoop edmund tan

Historically, our takeaways have contributed to a small portion of our business, but we are putting a lot more emphasis on bulk orders now.

Previously, we would just scoop the ice cream and place it in a cooler bag, but moving into the area of  bulk orders, we are now working out how our consumers can get our products in a better condition than before.

Given consumers are using their mobile phones a lot more nowadays since they are at home all the time, we wanted to get our brand advocated to recommend us in the group chats that they are already in for our bulk orders initiative. The easiest ways to do that was for them to recommend us on neighbourhood or condominium group chats.

This idea came around as one of our managers suggested that we should leverage on our big following. The initiative was launched about one and a half weeks ago, and we have one to two condominium deliveries each day. Each time the bulk order is about 50 to 70 pints per condo.  While the bulk order initiative is currently only centred in Klang Valley, we still do deliveries in Penang, Melaka and Ipoh via third-party delivery partners such as GrabFood.

We have about 27 locations nationwide and we are making sure our new business model changes to fit the new reality. For us, the new normal would be a 40% to 50% increase in sales post-MCO compared to now. We may also cut down on less profitable outlets, but it has not been decided on yet. What matters is we need to be flexible and see where the market takes us.
 

Besides our products, we are also focusing on customer experience, especially when it comes to online sales. Our in-store experience is warm and friendly, so we are trying to translate that into the virtual world. Ever since the MCO, the number of enquiries we have been receiving on social media have tripled. Hence, we try to recreate a good customer experience for our consumers through our communications with them. For example, instead of making it transactional by just answering their questions, we try to make the communications more personalised, relatable and friendly, and do our best to understand what the customer needs.

One tip we have for brands struggling to add revenue streams or evolve their products is to be flexible and evolve with the times. We resisted being on supermarket shelves for the longest time. However, one to two weeks after MCO, we decided to do a pilot project at Ben's Independent Grocer and have our products on their shelves. We previously operated a small stand in the stores but expanded to the shelves this time.

Bryan Loo, CEO, Loob Holding

bryan tealive e1512527074155 700x421

The DIY bubble tea kit started off as a pet project and my next goal is to turn it into an international appeal. Loob Holding has several more kits coming up from our sister brands such as Yunnan Bridge Noodle, Define Food, Define Burgers and Gindaco. In particular, our collaboration with Yunnan Bridge Noodle features an easy-to-cook kit which includes tomato soup broth and Yunnan dry noodles, enabling customers to recreate their favourite menu offering in the comfort of their homes. 

We realise that every brand has its own DIY angle and underlying DNA, which is worth delving deeper into. These are the reasons that made the brand famous in the first place, and we always use them as inspiration for our next DIY ideas.

We have also launched the Ko Ko Kai Chicken Rice DIY kit, and the inspiration was drawn from hawker stores chopping the chicken up into parts for consumption. We thought it would be cool if we could reverse the process and allow our consumers to appreciate what life as a chicken rice hawker would be like. This is done by letting them chop their own chicken and assemble their own chicken rice at home.

Our thought process has always been around how we can reverse engineer from a finished product or meal and recreate an experience via a simple and easy assembly model to allow our customers to do it at home.

Jason Ong, founder and CEO and Erika Hwong, co-founder Mykori Holdings

mykori jason erika

Our DIY ice cream kit, also known as Happiness Kits, came about since most consumers can no longer dine-in and deliveries are the only option for them. Consumers are also creating their own Dalgona coffees at home so we thought it would be good to venture into this area. Besides the ice cream kit, we also recently launched a Mykori Toast Box starter kit with our ice cream, toast bread, milo nuggets, popcorn, chocolate sauce and Oreo cookies. This is to keep consumers occupied since the MCO has been extended. Also, about 20 out of our 82 Mykori outlets are also currently doing deliveries via GrabFood. 

For the DIY kit, I drew inspiration from Tealive, which created its own DIY bubble tea kit.

Hence, I thought it would be interesting to do something similar since consumers are no longer able to patronise our cafes for now. Currently, we have sold over 200 Happiness Kits for the past one and a half weeks, amounting to about RM30k in sales.

One tip I have for businesses is to go online. Traditional businesses are beginning to evolve and go digital. We are also looking to sell our desserts, DIY kits and merchandise online.

Chin Ren Yi, co-founder, myBurgerLab

renyi

About two to three years ago, we launched our BBQ kit. But there wasn't much fanfare as consumers were more interested in patronising our stores to have food instead of cooking it on their own. However, we decided to bring it back and took about two and a half weeks to repackage it before launching it about a week ago.

Our home kit has patties, cheese slices, jalapeno and pickles and sauces. Our target was to sell about a thousand kits by the second week and so far we have crossed 350. The number is not a reflection of how successful the kit is for sure but we wanted to do something interesting for our consumers. We also partnered with Inside Scoop to throw in a free pint of ice cream.

As entrepreneurs, we are generally problem solvers and I do not think there is a go-to process for everyone.

I personally like to reach out to people such as my colleagues and mentors, and throw ideas around. Sometimes even our customers might be a sounding board. The DNA of myBurgerLab is that we are experimental, that's where the term "lab" comes in. As for "My", we are an open-sourced company and anyone who feels a sense of connection to the business can offer suggestions.

Besides the home kit, we also built a small island on the game Animal Crossing. This game has become popular recently, especially on Nintendo Switch, and allows users to build their own houses and interact with other characters. On 14 April, we put out a Facebook post that said "What's better than Animal Crossing and catching tarantulas!? Having to visit myBurgerLab Island on Animal Crossing of Course!".

We also introduced a challenge for our readers. From now until 28 April, they have the chance to build their best version of the myBurgerLab Animal Crossing stall and show it to us. If we like it, we will automatically gift them three months worth of myBurgerLab subscriptions. It is one burger per month so the winner will be getting three burgers in total.

Meanwhile, we also brought back the takeaway programme which we launched two years ago. We revamped it and included a new menu for takeaways to minimise the duration spent inside of stores and curb the spread of the virus. Post-MCO, we plan to partner with a third-party logistics partners to launch our in-house delivery service for our products. We will also introduce QR codes in stores so consumers can scan them and place their orders as well as pay without having to go to the cashier. This is to help minimise human interaction. 

For me, innovation comes from what you can do at this point to better some aspects of your business. If you are unable to open your store, then do internal training to improve the quality of your menu and food, for example, to prepare for post MCO. 

Suzanne Ling, co-founder and CMO, PichaEats

pichaeats suzanne ling

We recently launched our homemade soy yogurt by one of our chefs, chef Rania. This idea came about before MCO and we thought about rolling out our own yogurt one day, and the timing felt right when the MCO was implemented.

Currently, consumers want to try new food and are more health conscious. We are also in a few vegan and foodie groups, and those individuals are constantly looking for new things to buy when they are at home. We are at a time when everyone is very open to trying new things and food deliveries have also increased. This is why we started coming up with more products. 

We have always delivered Ramadan meals but this year, we reduced the amount of food from 10 pax to five pax to suit the current landscape, since large gatherings are no longer announced nowadays. What is also different this year is that our buffet catering business, which forms 60% of our sales, is completely gone and this has been pushing us to think about how we can evolve our business offering and build up on home deliveries. For home deliveries, we are not focused on gaining profit but rather on keeping things going and keeping our chefs busy. 

During a normal month, with the exception of Ramadan and Christmas, our sales for home deliveries is approximately RM20,000. Right now we are at RM40,000 to RM50,000. 

At the beginning of the MCO, the team understood that although we are unable to rake in plenty of sales during the week, we still want people to remember PichaEats coming out of MCO. Hence, we doubled down on our social media and have been creating content such as ways to keep your veggies fresh and ways to cook eggs. We have also partnered with influencers for Instagram Live sessions four times a week. This has helped increase our Instagram following from 11.2k to approximately 12.5k. 

We also launched a 14-day positivity challenge for our followers such as text your friends to check in on them and heading out to buy food from your favourite hawker. The MCO gives us space to do so much as it is a quiet period and we are trying to spread more positivity and hope through our content. We also reactivated the Zaza Movement, which was first launched in 2018 where the public can buy meals from a refugee family to be distributed to those in need during Ramadan. The past two months have been tough for our chefs but this Zaza Movement helped them, and we have been sending out 600 meals daily. We managed to raise enough for 18,000 meals but since the MCO has been extended, we will be doing another round for the third phase. 

The most important thing right now is to accept the fact that COVID-19 and MCO are happening and things are not the same. The old ways might not work anymore and the key is to let go of the attachment you might have towards your previous business plans and move fast.   

Fong Wai Hong, co-founder, StoreHub

storehub wai hong

When the MCO was announced, we knew that a large number of our F&B customers would suffer. True enough on the day of the MCO, there was a steep 85% drop of revenue across the board, with over 90% of businesses doing $0 in sales. With over 200,000 F&B businesses in Malaysia we felt compelled to do something. That was when the team decided to build and launch Beep Delivery within 48 hours of the MCO.

With Beep Delivery, restaurants now have an online ordering platform that makes taking orders, accepting payments, and finding a driver super easy. We have partnered with other startups in the ecosystem who are logistics platforms such as GoGet and TheLorry as well as Lalamove and Teleport to handle the actual delivery. The platform also facilitates contactless pick up orders seamlessly as well.

We have been working on a multitude of ways to give stores more exposure and publicity while also making each order more valuable. The first thing we did was to launch beepit.com and collaborate with multiple large partners TouchNGo Digital, Boost and Gocar to drive their tens of millions of users to our stores. We are incredibly grateful that in a time of crisis like now, our partners have been more than willing to support our initiative very generously without asking for much in return.

Secondly, we are working with distributors and suppliers to move daily essentials into stores that consumers could add on to their regular meal deliveries. So instead of just buying your latte and eggs benedict, you could add on fresh vegetables, fruits, whole chickens and an assortment of other groceries to your order. With most grocery delivery platforms booked out three weeks in advance and the more than 800 roadblocks limiting movement, being able to purchase your groceries from your neighbourhood cafe/restaurant really eases the burden on the already overcrowded supermarkets out there. This in turn also supports these small businesses by providing much needed extra cash flow as well as making each delivery order more valuable and efficient.

In this crisis period, the needs and pains of the stores we serve are glaringly obvious. This keeps us focused on figuring out how quickly we can solve them instead of what to solve. We have multiple channels that ensure direct feedback from our customers will reach our ‘war-room meetings’ so we can plan and execute on how best to tackle them. We also host brainstorming sessions every couple of days with multiple groups of StoreHubbers who contribute ideas towards how we can solve key challenges/bottlenecks that we’re facing and move into execution within days.

Experimentation and trying new things are amongst the top reasons why our most successful customers have been thriving.

They are not afraid to push the envelope of what the nature of their business is. Whether it is trying Facebook Live or putting together creative bundles of products or finding other friends to collaborate with, there is a million and one things that businesses can try to develop new revenue streams. Just because something does not work at first, does not mean it’s not good. Ideas require refining and oftentimes, it is simply that we need to execute better. So keep trying new things and reflecting on why things may or may not work!